Dear Penny: My Family Keeps Asking for Money and It’s Bleeding Me Dry

I have been the only one working since my wife and I had our first child, and it is stressful at times, especially when I’m laid off.

We just bought our first home together, and now my mother is temporarily living with us until she finds a job and an apartment. Also, my father called a few months back needing money, and then again today. It’s put my wife and me with just about no more savings.

We are not hurting, but it brings up a major concern about our future, especially with the unstable job I have. I guess what I’m trying to ask is how do I provide for so many people and keep our savings?

-Stuck

Dear Stuck,

You could take a second job. You could get a side hustle or five. You could work 100 hours a week or more. Heck, you could work so much that you quit sleeping if you really want to keep bailing out your family.

But I suspect you already know the answer to your question: You can’t keep providing for so many people and keep your savings intact. Your family is using you as a walking checking account. As long as you keep depositing money, they’ll keep making withdrawals.

Right now, you’re not in a position to financially assist family members. Think back to the instructions at the beginning of every flight you’ve ever taken and how they always tell you to put your oxygen mask on first before helping anyone else in an emergency. The reason, of course, is that you can’t help someone else if you pass out because you’re deprived of oxygen.

The same principle applies here: You’re out of savings, so you can’t help anyone, including yourself, in an emergency.

Schedule a time to go over the gamut of your finances with your wife, including how much you’re bringing in, how much you’re spending — both on your own expenses and for family — and your short- and long-term goals.

A goal to prioritize is rebuilding your savings, which is especially important since you have irregular income. Until you have several months’ worth of living expenses saved, I’d strongly suggest you both commit to not forking over cash until you’re on more solid financial footing.

Since your dad has hit you up for cash twice in the past few months, you need to tell him that you’re not in a position to help out. The reasons he needs money don’t matter. Keep the focus on you and how you don’t have the resources to bail anyone out.

The key is to communicate this soon. That means before he’s on the phone begging for money. Be prepared to say no and keep repeating it the next time he asks for help.

Don’t be swayed by any promises to pay you back. You can’t afford to loan money if you can’t afford to make that money a gift.

With your mother, you should have a talk about the financial stress you’re feeling — which there’s a good chance she’s experiencing too as she hunts for a job. Talk to her about if there are ways she could earn extra cash to contribute, whether it be through walking dogs, delivering groceries or babysitting. Even a contribution as small as $50 a week could relieve some of the pressure.

Once you’re in a better financial situation — meaning a healthy amount saved and you’re earning more than you’re spending — you may decide that you’re willing to help out family members in certain circumstances.

If so, setting limits before relatives hit you up will be key. Decide how much you can afford to offer if a family member needs money. Consider opening a separate savings account that’s earmarked for that.

Just know that when someone asks you for money, they’ll often make it sound like an either/or situation, i.e., either you loan me money or I experience the worst-case scenario, whether that means being evicted, having a car repossessed or having an account sent to collections.

But often it’s not. Being cut off from an easy source of cash can be a source of motivation. People find ways to earn extra cash or work out a plan to get caught up on payments. Or at the very least, they find someone else to hit up.

Just focus on how much you can afford to help out — and if you aren’t in a good place financially, that amount is zero.

Robin Hartill is a senior editor at The Penny Hoarder and the voice behind Dear Penny. Send your questions about money worries to [email protected]